Terms of preference shares

Equity capital markets (ECM)

When issuing preference shares, a company must set out the rights of preference shareholders respect to the following in its constitution:

• repayment of capital

• participation in surplus assets and profits

• cumulative or non-cumulative dividends

• voting

• priority of payment of capital and dividend in relation to other shares or other classes of preference shares.

This requirement is provided under section 90(4) of the Companies Act 2016 of Malaysia.

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This post was first posted on Linkedin on 1 April 2022.

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